Bitcoin BTC/USD may be bottoming after its recent sell-off, Brian Kelly, portfolio manager of BKCM Digital Asset Fund, said Tuesday on CNBC's "Fast Money."
What Happened: Bitcoin fell more than 50% from its highs as environmental concerns around cryptocurrency mining put the bears in control.
One of the key crypto metrics to monitor is the speed of address growth versus market expectations, Kelly told CNBC.
Address growth is essentially flat, he said, but the market is implying a decline of almost 20%.
The last time the differential in address growth versus expectations was this high was in March 2020, Kelly said, adding that when Bitcoin is as mispriced as it is now, it's a sign the cryptocurrency is bottoming.
The last time there was a similar divergence in the metric, Bitcoin was trading at $3,500, he said.
The market is mispricing the underlying fundamentals and the price of Bitcoin presents a great buying opportunity, Kelly told CNBC.
He said he's been adding to his Bitcoin holdings around the cryptocurrency's current price.
Related Link: Panic Over Dogecoin Price Shouldn't Kill Bitcoin, Ethereum, Other Fundamental Innovations In Crypto, Says Binance US CEO
BTC Price Action: Bitcoin is up 25.94% year-to-date.
At last check Tuesday, it was up 4.89% at $38,039.01.
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